Chinese solar manufacturers have been built on an unsustainable foundation of short-term debt from state-run banks. Companies like Suntech Power (NASDAQOTH: STPFQ ) , Yingli Green Energy (NYSE: YGE ) , Trina Solar (NYSE: TSL ) , and LDK Solar (NASDAQOTH: LDKSY ) all have more than $1 billion in debt, an unsustainable amount for companies reporting massive losses.
But we may be seeing a peak into whom China will choose to emerge as a long-term winner, and what qualities it's looking for. Jinko Solar (NYSE: JKS ) just received a $1 billion loan from the China Development Bank to build solar projects in Europe. The company had a 9.9% gross margin last quarter and less than $400 million in debt, both far better than most of the Chinese competition. So could Jinko be one of the few that survive?
Jinko Solar could very well survive and may be moving up the list of Chinese manufacturers but it's still a very risky bet. A profitable company like First Solar should still be a top pick of solar investors. For a deep dive into the stock along with continuing updates and guidance on the company whenever news breaks, we've created a brand new report that details every must know side of this stock. To get started, just click here now.